NBER WORKING PAPER SERIES ECONOMIC EFFECTS OF CURRENCY UNIONS Silvana Tenreyro
... Alesina and Barro [2002] provide a formal model for the anchor-client relationship in the context of the currency-union decision. The model shows that countries with lack of internal discipline for monetary policy (as revealed by a history of high and variable inflation) stand to gain more from givi ...
... Alesina and Barro [2002] provide a formal model for the anchor-client relationship in the context of the currency-union decision. The model shows that countries with lack of internal discipline for monetary policy (as revealed by a history of high and variable inflation) stand to gain more from givi ...
International Finance and the Foreign Exchange
... (a) An increase in the quantity of drilling equipment purchased in the U.S. by Pemex (the Mexican oil company) as a result of a Mexican oil discovery? (b) An increase in the U.S. purchase of crude from Mexico as a result of development of Mexican oil fields? (c) Higher real interest rates in Mexico, ...
... (a) An increase in the quantity of drilling equipment purchased in the U.S. by Pemex (the Mexican oil company) as a result of a Mexican oil discovery? (b) An increase in the U.S. purchase of crude from Mexico as a result of development of Mexican oil fields? (c) Higher real interest rates in Mexico, ...
FINANCIAL CRISES, RESERVE ACCUMULATION, AND CAPITAL FLOWS
... wealth-holder” from the third world. While inelasticity of price expectations in the asset market is a sufficient condition for equilibrium, it is obviously not a necessary condition. Even with unit elastic price expectations, equilibrium can still come about through what Keynes had called the “min ...
... wealth-holder” from the third world. While inelasticity of price expectations in the asset market is a sufficient condition for equilibrium, it is obviously not a necessary condition. Even with unit elastic price expectations, equilibrium can still come about through what Keynes had called the “min ...
The Political Economy of U.S. – Led Internationalization:
... Consider the following analysis based on by Pollard (1997), who has used and elaborated IMF data: 1) the rate of dollar internationalization, which is the relation between world exports denominated in dollars and U.S. exports, experienced a minor reduction from 4.5 in 1980 to 3.9 in 1995 but still d ...
... Consider the following analysis based on by Pollard (1997), who has used and elaborated IMF data: 1) the rate of dollar internationalization, which is the relation between world exports denominated in dollars and U.S. exports, experienced a minor reduction from 4.5 in 1980 to 3.9 in 1995 but still d ...
the choice of exchange rate regime
... be manipulated without consistent adjustments to, or consequences for, other components of the monetary situation - such as money stock, liquidity or interest rates. In the short term, changes to the exchange rate may influence the real economy and the balance of payments. In the longer term those e ...
... be manipulated without consistent adjustments to, or consequences for, other components of the monetary situation - such as money stock, liquidity or interest rates. In the short term, changes to the exchange rate may influence the real economy and the balance of payments. In the longer term those e ...
International FRQs answers
... goods produced in other countries which are now cheaper, and other nations will reduce purchases of Country Z’s goods, which are now more expensive Summary: Increase in government borrowing raises real rates, currency appreciates, decrease in net exports means GDP declines (price level declines too) ...
... goods produced in other countries which are now cheaper, and other nations will reduce purchases of Country Z’s goods, which are now more expensive Summary: Increase in government borrowing raises real rates, currency appreciates, decrease in net exports means GDP declines (price level declines too) ...
International
... goods produced in other countries which are now cheaper, and other nations will reduce purchases of Country Z’s goods, which are now more expensive Summary: Increase in government borrowing raises real rates, currency appreciates, decrease in net exports means GDP declines (price level declines too) ...
... goods produced in other countries which are now cheaper, and other nations will reduce purchases of Country Z’s goods, which are now more expensive Summary: Increase in government borrowing raises real rates, currency appreciates, decrease in net exports means GDP declines (price level declines too) ...
new version - the School of Economics and Finance
... In 1994, China pegged the yuan to the dollar. High productivity and low inflation rate lead to an increase in value of the yuan. Expected return for yuan assets increased, and demand shifted to the right. ...
... In 1994, China pegged the yuan to the dollar. High productivity and low inflation rate lead to an increase in value of the yuan. Expected return for yuan assets increased, and demand shifted to the right. ...
Financial instability in Latin America Sebastian Edwards 5
... A related issue, and one that requires significant additional attention by economists, is when to remove impediments to capital mobility. A first step in answering this question is determining the long-term consequences of capital mobility on economic performance. As Stiglitz (2002) has argued, this i ...
... A related issue, and one that requires significant additional attention by economists, is when to remove impediments to capital mobility. A first step in answering this question is determining the long-term consequences of capital mobility on economic performance. As Stiglitz (2002) has argued, this i ...
presentation - Centre for History and Economics
... New rules emerged through an iterative process of pressure by the strongest economies on the weakest, restricting progressively the scope of the Union 1) Extend limits of issue to other forms of fiduciary money (small change paper money from late 1860’s and silver écus from 1874) 2) Attributing to t ...
... New rules emerged through an iterative process of pressure by the strongest economies on the weakest, restricting progressively the scope of the Union 1) Extend limits of issue to other forms of fiduciary money (small change paper money from late 1860’s and silver écus from 1874) 2) Attributing to t ...
doc
... those that have the resources to benefit from world trade (those who produced x) will be better off with trade, but those who did not have the resources beneficial to world trade (those who produced y) will be worse off than without trade; however, if a scheme were implemented so that those who bene ...
... those that have the resources to benefit from world trade (those who produced x) will be better off with trade, but those who did not have the resources beneficial to world trade (those who produced y) will be worse off than without trade; however, if a scheme were implemented so that those who bene ...
Transmission of the Great Depression
... world. Others forced prices to fall to maintain the value of their currency. In almost all cases, deflation was accompanied by depression as declining aggregate demand moved countries down upward-sloping aggregate supply curves. The primary transmission channel of the Great Depression was the gold s ...
... world. Others forced prices to fall to maintain the value of their currency. In almost all cases, deflation was accompanied by depression as declining aggregate demand moved countries down upward-sloping aggregate supply curves. The primary transmission channel of the Great Depression was the gold s ...
The Euro Versus the Dollar: Will there be a Struggle for Dominance?
... Any substantial future depreciation would take place in a very different world, however: one which included the euro, the first potential competitor for global status that the dollar has faced throughout its period of currency hegemony. Such a future fall of the dollar could thus trigger important, ...
... Any substantial future depreciation would take place in a very different world, however: one which included the euro, the first potential competitor for global status that the dollar has faced throughout its period of currency hegemony. Such a future fall of the dollar could thus trigger important, ...
From Gold to the Ecu: The International Monetary System in
... pound at least slightly, which made the balance-of-payments position precarious. Britain was particularly vulnerable to withdrawal of foreign funds deposited or invested in London at short term. Foreigners held voluminous deposits in London partly because many of the smaller countries returned after ...
... pound at least slightly, which made the balance-of-payments position precarious. Britain was particularly vulnerable to withdrawal of foreign funds deposited or invested in London at short term. Foreigners held voluminous deposits in London partly because many of the smaller countries returned after ...
Summary of my Research
... This paper proposes a novel theory of boom-bust cycles generated by the interaction between contract enforceability problems and systemic bailout guarantees. The former imperfection may lead lenders to impose borrowing constraints to disincentivize borrowers to divert funds. Meanwhile, the latter in ...
... This paper proposes a novel theory of boom-bust cycles generated by the interaction between contract enforceability problems and systemic bailout guarantees. The former imperfection may lead lenders to impose borrowing constraints to disincentivize borrowers to divert funds. Meanwhile, the latter in ...
Slide 1
... Balance of payments accounting Helps us keep track of both changes in a country’s indebtedness to foreigners and the fortunes of its export- and import-competing industries ...
... Balance of payments accounting Helps us keep track of both changes in a country’s indebtedness to foreigners and the fortunes of its export- and import-competing industries ...
PDF Download
... not surprising in the light of negative real interest rates – started in the 1980s. The first step involved the indexation of financial obligations in 1979. Interest rates were subsequently made market determined. There followed the privatisation of commercial banks in the 1990s. The country now has ...
... not surprising in the light of negative real interest rates – started in the 1980s. The first step involved the indexation of financial obligations in 1979. Interest rates were subsequently made market determined. There followed the privatisation of commercial banks in the 1990s. The country now has ...
CURRENCY DEVALUATION AND POVERTY IN NIGERIA (PDF
... volatility that devaluation cause in the exchange rate has translated a major impact on the increasing of inflation in the country (Bakare, 2014). That is, the currency devaluation of Naira has contributed to inflationary trends in Nigeria (Imimole & Enoma, 2011). Besides, Ogundipe et al., (2013) fo ...
... volatility that devaluation cause in the exchange rate has translated a major impact on the increasing of inflation in the country (Bakare, 2014). That is, the currency devaluation of Naira has contributed to inflationary trends in Nigeria (Imimole & Enoma, 2011). Besides, Ogundipe et al., (2013) fo ...
Fixed Exchange Rates
... • From 1944 to 1973, central banks throughout the world fixed the value of their currencies relative to the U.S. dollar by buying or selling domestic assets in exchange for dollar denominated assets. • Arbitrage ensured that exchange rates between any two currencies remained fixed. – Suppose Bank of ...
... • From 1944 to 1973, central banks throughout the world fixed the value of their currencies relative to the U.S. dollar by buying or selling domestic assets in exchange for dollar denominated assets. • Arbitrage ensured that exchange rates between any two currencies remained fixed. – Suppose Bank of ...
Boom, Gloom, Doom: Balance Sheets, Monetary Fragmentation
... links the value of domestic currency closely to the dollar or other authoritative international currencies. Such exchange-rate pledges were intended to rein in inflationary expectations. In this they usually had some immediate successes. However, ERBS programs had other, more troubling financial con ...
... links the value of domestic currency closely to the dollar or other authoritative international currencies. Such exchange-rate pledges were intended to rein in inflationary expectations. In this they usually had some immediate successes. However, ERBS programs had other, more troubling financial con ...
Balance Sheets after the EMU - OFCE
... the position of a sector/country with a positive position. The problem of a negative impact on balance sheets of domestic actors thus concerns not only a country with a negative net foreign currency position which will devalue, but also a country with a positive position which would experience an ap ...
... the position of a sector/country with a positive position. The problem of a negative impact on balance sheets of domestic actors thus concerns not only a country with a negative net foreign currency position which will devalue, but also a country with a positive position which would experience an ap ...
IOSR Journal of Business and Management (IOSR-JBM) e-ISSN: 2278-487X, p-ISSN: 2319-7668 www.iosrjournals.org
... from NRI buyers as long as the capital value levels are also maintained and do not see a big hike during the period. At current rupee levels and sluggish market conditions in many markets that are expected to remain for the next few months, NRIs could possibly benefit substantially from some attract ...
... from NRI buyers as long as the capital value levels are also maintained and do not see a big hike during the period. At current rupee levels and sluggish market conditions in many markets that are expected to remain for the next few months, NRIs could possibly benefit substantially from some attract ...
The great exchange rate debate after Argentina Sebastian Edwards ∗
... S. Edwards / North American Journal of Economics and Finance 13 (2002) 237–252 ...
... S. Edwards / North American Journal of Economics and Finance 13 (2002) 237–252 ...
Currency war
Currency war, also known as competitive devaluation, is a condition in international affairs where countries compete against each other to achieve a relatively low exchange rate for their own currency. As the price to buy a country's currency falls so too does the price of exports. Imports to the country become more expensive. So domestic industry, and thus employment, receives a boost in demand from both domestic and foreign markets. However, the price increase for imports can harm citizens' purchasing power. The policy can also trigger retaliatory action by other countries which in turn can lead to a general decline in international trade, harming all countries.Competitive devaluation has been rare through most of history as countries have generally preferred to maintain a high value for their currency. Countries have generally allowed market forces to work, or have participated in systems of managed exchanges rates. An exception occurred when currency war broke out in the 1930s. As countries abandoned the Gold Standard during the Great Depression, they used currency devaluations to stimulate their economies. Since this effectively pushes unemployment overseas, trading partners quickly retaliated with their own devaluations. The period is considered to have been an adverse situation for all concerned, as unpredictable changes in exchange rates reduced overall international trade.According to Guido Mantega, the Brazilian Minister for Finance, a global currency war broke out in 2010. This view was echoed by numerous other government officials and financial journalists from around the world. Other senior policy makers and journalists suggested the phrase ""currency war"" overstated the extent of hostility. With a few exceptions, such as Mantega, even commentators who agreed there had been a currency war in 2010 generally concluded that it had fizzled out by mid-2011.States engaging in possible competitive devaluation since 2010 have used a mix of policy tools, including direct government intervention, the imposition of capital controls, and, indirectly, quantitative easing. While many countries experienced undesirable upward pressure on their exchange rates and took part in the ongoing arguments, the most notable dimension of the 2010–11 episode was the rhetorical conflict between the United States and China over the valuation of the yuan. In January 2013, measures announced by Japan which were expected to devalue its currency sparked concern of a possible second 21st century currency war breaking out, this time with the principal source of tension being not China versus the US, but Japan versus the Eurozone. By late February, concerns of a new outbreak of currency war had been mostly allayed, after the G7 and G20 issued statements committing to avoid competitive devaluation. After the European Central Bank launched a fresh programme of quantitative easing in January 2015, there was once again an intensification of discussion about currency war.